Pakistan never ceases to amaze. This was evident in their recently concluded elections. Polling results were delayed by days to select candidates shortlisted by the Rawalpindi clique of generals.
In a sigh of relief coming after a long time, Pakistan’s benchmark index on Tuesday breached 60,000 to trade at an all-time high of 60,500.61 points, Pakistan Stock Exchange data said.
There is an anticipation by the investors that the central bank will cut the rate which is currently set at 22 per cent.
According to the data released by the Pakistan Bureau of Statistics, the country’s inflation rate was recorded at 41.13 per cent in the week ending November 23.
Reports suggest that the high gas prices have resulted in an increasing inflation rate as it has increased by more than Rs 1,100 in the last one year.
Pakistan has been in a deep crisis for long time back. Despite difficulties, the index shoot to record high as recently the International Monetary Fund (IMF) approved a USD 3 billion loan programme in July to avert a sovereign debt default.
While approving the USD 3 billion loan in July this year, the Washington-based global lender had also released the first tranche of USD 1.2 billion.
Analysts further believed that the market is welcoming a successful staff-level agreement for the second tranche of funds under the current IMF Standby Arrangement, along with a expected disbursement of the funds in December and other foreign exchange inflow from multilateral institutions.
Notably, since crossing the 53,000-point mark, the Pakistani stock market has been on a steady upward trend. The positive sentiment among investors has been reflected in the market’s performance, with consecutive weeks of gains.
The surge has been underpinned by strong buying activity across various sectors with notably in the energy sector that has witnessed significant interest, with companies in this sector experiencing substantial share price gains.
Last week, Pakistan’s caretaker Finance Minister Shamshad Akhtar said that political instability over the period of time has greatly disrupted the cash-strapped country’s economic growth, which has to be backed by structural reforms.
Macroeconomic stability has become more difficult in the last decade because of delays in structural reforms, protracted actions and exogenous shocks, the minister said.
Akhtar said Pakistan was exploring avenues for debt for nature climate swaps with different partners.